Explore the advantages of investing in mutual funds

Discover how you can strengthen your portfolio with mutual funds

Mutual funds offer investors literally thousands of investing choices across asset classes, sectors and many other categories. Learn about mutual funds, and the different tools and services we offer, such as the TD Ameritrade Premier List, to help you choose a fund for your investment strategy.

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Explore the information and resources below to learn about the number of factors you should consider before investing in a mutual fund. If you have questions along the way, contact one of our Mutual Fund Specialists for help.

Understanding the Basics

Mutual funds are a professionally managed portfolio of investments backed by capital from a pool of investors. Each fund family has its own stated goals or objectives, as well as risk/reward level. Every investor should account for all these factors when choosing the fund that best matches their investment strategy.

Unlike stocks that trade during the day, the share price of a mutual fund is determined at the end of the trading day. That price is known as the net asset value, or NAV. The NAV is the sum total of the value of all the holdings within the fund.

Investing in Mutual Funds

Choices: There is a huge variety of mutual fund for investors to choose from today that span across many asset classes, such as stock and bonds, and investment styles, such as value, growth, or dividend investing.

Diversification:Many investors add mutual funds to their portfolio to mitigate risk from other holdings or simply diversify their overall portfolio.

Access: Mutual funds give investors access to equities that would normally be out of reach for investors with a small amount of capital.

Professional Management:Investors that don’t want to manage a large batch of holdings on their own can delegate the responsibility to fund managers will monitor, adjust and reallocate as needed.

Many No-Transaction-Fee Funds:There are hundreds of no-transaction-fee (NTF) funds to choose from—you can easily find the best one for your respective strategies and goals.

Selecting Your Mutual Funds

Before finally choosing a mutual fund, there are a number of considerations you need to take into account, such as each fund’s investment objectives, risks, charges, and expenses. A thoughtful and objective approach during your selection process is the smartest way to help protect your investment.

A great place to do some simple homework is our mutual fund research section, which allows you to browse and research different categories of funds. Plus as a client, you gain access to expert mutual fund research, such as Premier List.

Afterward, it will be important to continue monitoring the performance of your mutual fund to ensure it’s still aligned with your strategy and interests at the time.

Exclusive Tools to Help You Start

With access to TD Ameritrade’s exclusive Premier List and powerful research tools, you can analyze, compare, screen and evaluate your current fund holdings to help maximize your mutual fund investments.

Carefully consider the investment objectives, risks, charges and expenses before investing. A prospectus, obtained by calling 800-669-3900, contains this and other information about an investment company. Read carefully before investing.

Market volatility, volume and system availability may delay account access and trade executions.

Educational resources are provided for general information purposes only and should not be considered an individualized recommendation or advice.

*No-transactions-fee funds have other fees and expenses that apply to a continued investment in the fund and are described in the prospectus.

Research and planning tools are obtained by unaffiliated third-party sources deemed reliable by TD Ameritrade. However, TD Ameritrade does not guarantee their accuracy and completeness, and makes no warranties with respect to results to be obtained from their use.

Past performance of a security does not guarantee future results or success. Investments in a mutual fund are not FDIC-insured and may lose value.

*The Premier List represents what Morningstar believes to be the 'best-in-class' and 'top picks' funds in each category, from the universe of no-load funds with minimums less than $10,000 and open to new investors available on TD Ameritrade's platform.

Morningstar Investment Management LLC is a registered investment adviser and subsidiary of Morningstar, Inc. The Premier List represents what Morningstar Investment Management believes to be the “best-in-class” and “top picks” funds in each category from the universe of no-load funds with minimums less than $10,000 and open to new investors available on TD Ameritrade’s platform. The universe of mutual funds made available on TD Ameritrade’s platform does not include all mutual funds available in the marketplace. Both the universe of mutual funds defined by TD Ameritrade and the Premier List are subject to change at any time without notice. Particular mutual funds on the Premier List may not be appropriate investments for you under your circumstances, and there may be other mutual funds or investment options offered by TD Ameritrade that are more suitable. Morningstar Investment Management may have more favorable opinions of certain mutual funds which are not included in the universe of mutual funds made available through TD Ameritrade. The Morningstar Investment Management selections were based on qualitative factors and quantitative analysis in addition to the judgment of Morningstar Investment Management analysts. Morningstar Investment Management does not warrant this information to be accurate, complete or timely. Morningstar Investment Management is not responsible for any damages or losses arising from the use of this information and is not acting in the capacity of adviser to individual investors. Past performance is no guarantee of future results.